Jan 11, 2021 (IAM Newswire via COMTEX) -- As a glimpse of a new normal is on the horizon, automakers are planning big EV launches this year. Even the Chinese internet giant Baidu /zigman2/quotes/209050136/composite BIDU -3.23% wants in on the action as it revealed on Friday it has formed a strategic partnership with the automaker Geely /zigman2/quotes/207616414/delayed GELYY -2.24% to create a standalone electric vehicle company. While 2020 was summed up as the 'breakthrough' year for EVs, 2021 will be the year of EV launches. While the pandemic cut global new car sales by 30%, EV sales in Europe bucked that downward trend, improving 45% on a YoY basis.
In 2020, close to 1.25 million EVs were sold in Europe, which represents around 10% of the total. In November alone, EVs reached 16% market share, divided between BEVs and PHEVs at 8% each. In Norway, EV registrations rose from 42% in 2019 to 54%, making it the first country with over half of new-car registrations coming from electric vehicles. As EV sales accelerated towards the end of the year, in December, it even reached 66.7%. No other country matches Norway's generous EV promotion policy, but the trend is moving in the same direction elsewhere too, albeit slower. In the UK, for example, EVs grew from 3% in 2019 to 10% in 2020, and they're predicted to outsell diesels this year.
Nobody in the business had a better year than Tesla /zigman2/quotes/203558040/composite TSLA -8.06% . The EV pioneer saw the value of its stock increase by nearly 750% to just under $670 billion, now making it worth five times the stock value of rival Detroit's big three manufacturers General Motors /zigman2/quotes/205226835/composite GM -4.35% , Ford /zigman2/quotes/208911460/composite F -4.16% and FCA combined.
The question is whether the meteoric rise of Tesla stock marks a genuine breakthrough of e-mobility with Tesla positioned to maximise its benefit or whether it is due to an over-valued and over-optimistic view of the speed of automotive electrification. 2021 will put that question to the test. For now, Tesla sells more EVs per hour than any other electric vehicle company in the world, more specifically, more than BMW /zigman2/quotes/200850296/delayed BMWYY +0.28% , Volkswagen /zigman2/quotes/204431732/delayed VWAGY -3.16% and Renault /zigman2/quotes/202090946/delayed RNLSY -0.89% put together.
For one thing, Germany's car brands aren't standing still. Tesla is completing its 'Gigafactory' near Berlin which will soon start churning out Model Y cars. Also produced in the US and China, this compact SUV could become the EV of the year.
Volkswagen Group is the first major OEM to have developed a platform for EVs, which it hopes will drive down cost per vehicle, allowing Volkswagen to beat Tesla on price. In December, Audi, which belongs to the VW Group, began production of the e-tron GT which will go on sale in March. By 2022, Audi wants to launch the Q4, a compact eSUV, that will cost around EUR40,000. This price tag allows it to compete with both ICEs and Teslas.
Mercedes plans to launch the EQA, closely styled on the EQC along with the EQS. It will be costlier, but with a slightly greater range than Tesla Model S.
BMW is going full speed ahead as it upgraded its EV sales target from 2021 to 2023 by a quarter of a million. By 2023, BMW wants 20% of its production to be EVs, compared to just 8% in 2020. BMW plans to launch entirely new BEV models starting from 2025, while rolling out electric versions of existing models until then because the company does not expect BEV sales to take off until 2025.
On the one hand, ever-stricter European regulations and the ambitions of key countries such as the Netherlands to eliminate sales of ICEs within a decade or so are creating the necessity to prepare for a post-ICE future. All major OEMs will be launching new and all-new EV models this year, so no wonder that's why some experts predict that the electrification of mobility will speed up in 2021. On the other hand, the price of EVs is still far greater than of ICEs, the battery technology still has to overcome range anxiety, followed by the charging infrastructure that needs to be developed. The direction of the market is clear, but the speed is not.
Throughout 2021, battery cost will certainly continue to go down while the EV range will continue to expand. At some point, EVs will start to make financial sense, regardless of subsidies and incentives. However, experts disagree when this will happen, in 2025, 2030 or even later but few are expecting it for 2021. However, after about a decade of slow progress, 2021 will be the year of significant progress for EVs.
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